July trade deficit climbs 16.3 pct to $32 billion

In this Aug. 16 2009, the Toyota logo shines off the nose of an 2010 Camry sedan at a Toyota dealership in Centennial, Colo. The Commerce Department said Thursday, Sept. 10, 2009, U.S. trade deficit shot up in July to the highest level in six months as a surge in shipments of foreign oil and autos pushed imports up by a record amount.(AP Photo/David Zalubowski)
— AP

In this Aug. 16 2009, the Toyota logo shines off the nose of an 2010 Camry sedan at a Toyota dealership in Centennial, Colo. The Commerce Department said Thursday, Sept. 10, 2009, U.S. trade deficit shot up in July to the highest level in six months as a surge in shipments of foreign oil and autos pushed imports up by a record amount.(AP Photo/David Zalubowski)
/ AP

The increase in the July deficit marked the second consecutive month it has increased after hitting a nearly nine-year low of $26.4 billion in May. The June deficit was revised up slightly to $27.5 billion.

So far this year, the deficit is running at an annual rate of $355.5 billion, just half of last year's total deficit of $695.9 billion. Economists believe the deficit will keep rising in the months ahead, reflecting stronger growth in the United States and rising oil prices.

Economists see the widening trade deficit as further evidence that the recession is coming to an end and they expect the imbalance in 2010 will be approaching the levels seen before the recession hit.

America's deficit with Canada, the country's largest trading partner, surged by 41.7 percent in July to $2.2 billion, up from $1.5 billion in June. The deficit with the European Union jumped by 76.5 percent to $8 billion while the deficit with the Organization of Petroleum Exporting Countries rose by 18.5 percent to $6.9 billion. The imbalance with Mexico fell by 14.4 percent to $2.9 billion.